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ilivehere
Posts:128
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| 09/29/2008 12:41 PM |
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One more thing,
I don't think we have the facts due to the media on the true nature of the banks and the state of peril their in. They may be in a world of hurt or not and hyped to the nth degree to cause panic and get the bill pushed through. I DONT KNOW, What i do know is what is written below.
You might want to go take a look at your 401k and your cost of milk. As these business owners lose in the stock market and profits fall the only place to get the money back is to cut overhead and raise prices. Job losses will go up and the cost of goods will also rise. Interest rates will probably go up too which will make your DTI too high to afford the house you have been looking to purchase. Then again maybe home prices will plummet too, people will get that home they always wanted and be able to hand the keys back to the landlord and live happily ever after... |
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ilivehere
Posts:128
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| 09/29/2008 12:54 PM |
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TPC-
Your right in the big picture but your talking to a large audience of renters that think this bill not passing means lower home prices. It will be hard to get your opinion across to a mentality of people wanting home prices to fail due to their opinion that anyone who bought a house in the last 5 years can't afford it or was given to them.
If the bill doesn't pass and we are not being lied to on the actual financial state of the banks then we will see in the next few months if someone was just crying wolf or they were right. Time will tell. |
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jpinpb
Posts:1450
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| 09/29/2008 1:01 PM |
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I have been asking myself w/that bailout will mean for home prices. I don't think the bailout will allow prices to not decline. In fact, maybe the opposite. The banks have assistance from the government and then could proceed to reduce prices and foreclose w/impunity. The bailout is for banks really, not for homeowners. That's what I understood, but I'm playing catch-up from being gone 3 weeks.
In any case, whether helping prices to go down or not, taxpayers are sufficiently buried. |
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TotoMMB66
Posts:98
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| 09/29/2008 1:11 PM |
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Let the banks die. If I go out and over spend, I don't get a bailout. I get to declare bankrupcy and spend the next decade repairing my history. This should be a lesson for any business (bank or otherwise) that a bad business plan will lead to non-existence. Leave them stuck w/ their bad assets and let the strong ones begin to make good, smart business decisions. Credit got us (everyone, individuals, businesses, goverments) into this mess. We need a shake-up to change everyone's thinking, not just slapping band-aid after band-aid on the situation. Maybe the billion dollars a day we spend fighting in Iraq can come back home...(I know it's all funny money, but we'll pay for it sometime.
Might as well get Bush out of the WH now, he basically has zero power. Once he moves out, we can scope out the property on DClookup (dt) cm. (Hope they don't kill the thread). |
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Brian
Posts:2210
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| 09/29/2008 1:12 PM |
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I agree with you jpinpb. It's a bailout for the banks and they are trying the trickle down method. Expect that this time, it won't trickle down because the banks are in trouble. The spread between cost of funds for the banks and what they are lending to the consumers at is widening, now narrowing.
It's not possible to give help directly to the homeowners, even if we wanted to. If some our your neighbors get bailed-out, then everyone will clamor for a bailout too; and that will create a domino effect of foreclosures just to collect on bailout money.
The American consumer is tapped out. He needs to reduce leverage not borrow and consume more. Only the passage of time will allow that to happen.
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BTW, jpinpb, did you have a good holiday in Europe? Welcome back. :)
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jpinpb
Posts:1450
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| 09/29/2008 1:25 PM |
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| Brian - My vacation in Europe was great. It was quick, yet I was ready to come home on Friday. I was on the go pretty much the whole time, flying from cities and taking trains everywhere and even a boat to Isola d'Elba. I think when I was planning the itinerary it all sounded good on paper, but logistically was a little tiring. Still, I'm already wanting to go back and thinking of more things I wanted to see and do. I didn't make it to the Louvre. I did the obligatory Eiffel Tower, Arc and Notre Dame. The weather was unseasonably cold all over Europe. Rained most of the time while I was in Paris. Many more tourists than I remembered last time I was in Italy, especially for September. I think since the EU and open boarders and no monetary changes, it made it much easier for Europeans to travel. There were literally tour bus-loads full. It's been a while since I was there. Italy was still using the lira. The dollar sucks there right now and despite what many are saying about European dollar being strong compared to ours, it's not getting them far in their own country and many are struggling there. Anyway, back to the rude reality here. |
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wilson
Posts:541
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| 09/29/2008 2:00 PM |
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I predict a "bailout" plan will pass after the elections when representatives see the mistake they made.
I see a lot of people losing their jobs IF the financial system breaks down. Those buyers praying for lower prices will get them, but they may not be able to get financing or won't have the income after they lose their jobs. |
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showboat
Posts:67
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| 09/29/2008 2:02 PM |
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"More than two-thirds of Republicans and 40 percent of Democrats opposed the bill."
Looks like we may have Pelosi partly to thank for this outcome perhaps: "We could have gotten there today had it not been for the partisan speech that the speaker gave on the floor of the House," Minority Leader John Boehner said. Pelosi's words, the Ohio Republican said, "poisoned our conference, caused a number of members that we thought we could get, to go south."
In Colorado, Democrat Barack Obama said, "Democrats, Republicans, step up to the plate, get it done." - correct me if I am wrong, but shouldn't Duhbuma be helping too!?
I like this one! - "We're all worried about losing our jobs," Rep. Paul Ryan, R-Wis., declared in an impassioned speech in support of the bill before the vote. "Most of us say, 'I want this thing to pass, but I want you to vote for it — not me.'"
http://news.yahoo.com/s/ap/20080929/ap_on_bi_ge/financial_meltdown |
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BigTrace
Posts:194
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| 09/29/2008 2:02 PM |
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ilivehere - I agree with your post on this. We will see higher inflation, higher joblessness etc., but that will take some time and by then, who knows what deal will be put in place.
Brian, I agree with you too. This country has been surviving on "drugs" for sometime now. It's called "debt" and the gov't is trying to get the banks to start giving us back our drugs so we all stay fat, dumb and happy. They didn't count on "cold turkey" but really, that's what this needs, a good cleansing. It will ruin some, that's for sure, and it will cause some hurt for some time. A recession is eminent and unemployment will rise, but we're going to need to come up with a smrt solution to both the homeowners problems as well as the business problems and it's not going to take a week to solve it. Someone knew this was coming long long ago. How does one author legislation to spend 700B in 10 days??? The market panic is overdone IMO. We'll see though. Anything can happen. |
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Brian
Posts:2210
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| 09/29/2008 2:22 PM |
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Posted By wilson on 09/29/2008 2:00 PM
I predict a "bailout" plan will pass after the elections when representatives see the mistake they made.
I see a lot of people losing their jobs IF the financial system breaks down. Those buyers praying for lower prices will get them, but they may not be able to get financing or won't have the income after they lose their jobs.
I agree that some kind bailout legislation will pass.
But as I said before the bailout is whatever for it materializes won't help homeowners and thus prices. It will lower the cost of funds for the banks who will lend to consumers at higher margins.
Lower house prices are coming regardless. It's preferable to lose a job without any debt and a solid cushion in savings than to lose a job while barely able to keep up a mortgage with no savings whatever.
The person with solid savings can enjoy life, take some time off, go back to school or pursue other endeavors. The person without savings will be hustling for the next scam.
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jakob
Posts:473
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| 09/29/2008 2:24 PM |
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Our calls and faxes worked!!!! It's so refreshing that congress actually listens to their constituents once in a while. Over 90% of calls were against the bailout.
However, I fear that another couple days like today in the stock market and at least 12 Republicans will come over to the yes side. Wall Street's greatest coup was getting millions to invest their 401k money in the casino of lower Manhattan. |
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jakob
Posts:473
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| 09/29/2008 2:27 PM |
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| Or as a commenter on CR said, people are checking their 401ks only to find they now have a 301k. |
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Brian
Posts:2210
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| 09/29/2008 2:28 PM |
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Posted By showboat on 09/29/2008 2:02 PM
I like this one! - "We're all worried about losing our jobs," Rep. Paul Ryan, R-Wis., declared in an impassioned speech in support of the bill before the vote. "Most of us say, 'I want this thing to pass, but I want you to vote for it — not me.'"
Showboat, I believe that the bailout would have passed had McCain not injected politics into and suspended his campaign to save America.
More Democrats would have voted for the bill and passed it. However, that would have handed McCain a victory. He gambled and lost. Now he needs to lick his wounds and move on.
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Brian
Posts:2210
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| 09/29/2008 2:30 PM |
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Posted By jakob on 09/29/2008 2:24 PM
Wall Street's greatest coup was getting millions to invest their 401k money in the casino of lower Manhattan.
That was the beginning of the boom in stocks.
Do you think that the Republicans will revive calls to privatize Social Security to bail-out the market? |
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jakob
Posts:473
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| 09/29/2008 2:42 PM |
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| Brian, LOL. I think we are going to see major new regulations. An end of an era on Wall Street. No more massive leverage means much less profit. As a country, it's time to invest in actually producing something useful in America. Tom Friedman's column today was a breath of fresh air. |
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ownhomeinSD
Posts:163
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| 09/29/2008 2:42 PM |
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Posted By showboat on 09/29/2008 2:02 PM
I like this one! - "We're all worried about losing our jobs," Rep. Paul Ryan, R-Wis., declared in an impassioned speech in support of the bill before the vote. "Most of us say, 'I want this thing to pass, but I want you to vote for it — not me.'"
Exactly for those Repubolicans! "I want this thing to pass, but I want you to vote for it — not me.". Democratians are not that stupid for taking full responsiblity for passing it when current is critical and future is not that clear and some voters are angry due to not everyone can understand in-depth. |
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Goingup?
Posts:150
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| 09/29/2008 2:51 PM |
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The R.T.C. was a success back in the 80's and 90's and cost about 120B when estimates were up close to 500 Billion.
This bill will pass in the next few days, and banks will start lending to each other again.
The Fed should be happy in all this, as the 3 month T bill is around .3%. Now if they could just get the 10 year note that low we'd have something.
You can't have a economy fuctioning properly without banks lending to each other and people putting all their savings under their mattress (or T bills paying less than 1% interest....can you Japaneese economy with 15 years of flat growth).
Those against this bailout, and it is a bail out just like the RTC was, are missing the bigger point. Do nothing and you'll see negative GDP for next 5 years. The cost to the economy will be far in excess of 700B, and will effect everyone.
BTW, there is still tons of money out in the world. The oil bubble is over, and all commodities will follow, as will the stock market and the dollar. Hard not to see Real Estate making a come back...where else is the money to flow?
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airplanedad
Posts:131
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| 09/29/2008 3:05 PM |
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| nice discussion, everyone. |
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tpc
Posts:498
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| 09/29/2008 3:17 PM |
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[quote]You can't have a economy fuctioning properly without banks lending to each other and people putting all their savings under their mattress (or T bills paying less than 1% interest....can you Japaneese economy with 15 years of flat growth).[/quote]
Going-right on brother. You get it. |
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lurknomore
Posts:270
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| 09/29/2008 3:20 PM |
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| I believe something very close to this bill will be passed, probably by the end of this week. They will make some cosmetic changes (increase the type size? renumber the sections? change it from $700 billion to $675 billion? etc?) so a dozen or so repubs can say, "Oh. That's better! I can support it now!" As an alternative, some additional dems will come over in response to the stock market disruption (to save constituents retirement accounts, etc.), followed by a bunch of repubs who don't want to be left out. One way or another, the "workout" will most likely pass. And in 3-5 years it will be a net plus for the Treasury. |
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